A Canadian Grain Commission (CGC) proposal to give farmers more time to ask the CGC to grade their grain when they disagree with an elevator ruling is supported by a majority who responded to the CGC’s request for feedback. Currently, farmers have to make that decision at the time the grain is delivered to an elevator.
In December 2021, the CGC proposed farmers have up to seven days to ask the commission to determine grade — a process called “Subject to Inspector’s Grade and Dockage.”
In such cases the CGC’s determination is final and binding.
Read Also
Mazergroup’s Bob Mazer dies
Mazergroup’s Bob Mazer, who helped grow his family’s company into a string of farm equipment dealerships and the main dealer for New Holland machinery in Saskatchewan and Manitoba, died July 6 from cancer.
The current approach doesn’t work for farmers who get others to haul their grain, CGC chief commissioner Doug Chorney said in December.
“We clearly have some logistical challenges on the way grain is marketed today and what the legislation might have contemplated when it was written originally,” Chorney said. “We want to have a system that is accessible and easy to use and solves some of these challenges that stakeholders have talked about.”
The grain sector, including farmers, had until Feb. 28, 2022 to submit comments on the proposed extension.
Why it matters: Expanding the time farmers can ask for a CGC-determined grade would give farmers more flexibility, but add a measure of cost to the grain system.
“The majority of respondents did not recommend changing the time period indicated in the Canadian Grain Commission’s proposal,” the CGG stated in an online report published in May.
The most common suggestion coming out of the comment period, marked in six of 13 responses, was to “amend the number of days a producer has,” to trigger the dispute settlement mechanism after getting an elevator receipt.
Of those six, half suggested a change to five business days, from seven calendar days.
“They noted that business days would allow producers to have five days to consider their options without having to factor in holiday disruptions,” the CGC reported.
Other suggestions ranged from three business days to a period beyond seven calendar days, in order to facilitate trucker paperwork, neighbouring farmer discussions and comparisons of other elevators.
In its submission, the Western Grain Elevator Association (WGEA) noted there would be a cost to storing grain samples, but supports extending the time farmers have to get a CGC grade, executive director Wade Sobkowich said in an interview May 27.
That support is based on CGC arbitration continuing to apply only to grade and dockage and not specifications, he added.
The WGEA’s submission also noted that when a farmer now delivers grain, it’s binned right away and might even be quickly shipped out. If the CGC assigns another grade,
the grain buyer has the option of returning grain of the same grade and quantity to the farmer.
“The WGEA and its members are supportive of the ‘Subject to Inspector’s Grade and Dockage’ process in principle and recognize it must remain workable in a changing industry,” the association said. “If in the consultation process there are proposals from stakeholders calling for more onerous changes, including but not limited to, longer time lines for example, we would object to that.”
Six of 13 respondents also suggested that the CGC provide more oversight for grain sampling and compliance inspections at primary elevators, the CGC said. That included requests for clarity on what is a reasonable sample for the dispute mechanism’s purposes and how that would be stored to ensure sample integrity.
Other comments
Three respondents raised the issue of fees, such as a mailing fee charging the farmer to ship samples to the CGC, or elevator reluctance to send a sample due to CGC service fees.
Two submissions recommended waiving the fee.
Other suggestions included a rule that would require elevators to provide grading information within 48 hours of delivery. Another suggested that, in addition to private company inspections, the CGC should have private companies collect data to provide producers with better market information.
Four of 13 submissions referenced producer eligibility to retain samples.
One recommended language that would entitle farmers to keep a sample for their own records. One suggested producers be entitled to keep enough sample to independently verify any contract specifications in the event of a dispute.
Two submissions requested clarity on where producers and primary elevators can agree to retain a sample off site.
Three, meanwhile, suggested expanding the scope.
The CGC process can be used to dispute any regulated grain’s official grade or any individual grading factor, such as moisture, protein and dockage, but currently can’t be used to dispute grain delivery contract specifications that are not listed in the Official Grain Grading Guide, such as falling number and deoxynivalenol (DON).
Two respondents also requested the process be extended to include all classes of licensees that purchase grain directly from farmers, not just licensed primary elevators.
Two respondents raised the issue of farmers not being allowed to observe elevator operators perform grade and dockage assessment at delivery.
One said that physical barriers, in place to protect against COVID-19, inadvertently restricted farmers from observing the grading and dockage process, which may increase the risk of a dispute.
One also raised concerns that farmers can’t verify that samples are weighed accurately during grading and that farmers are not being compensated for the grain lost during sampling.
The CGC has said that all consultation feedback will be considered as it makes regulatory changes.
